Key Takeaways
- • On August 18, 2026, the SEC proposed Regulation Crypto Assets ("Reg CA"), its first standalone offering framework designed specifically for crypto assets, according to Mintz.
- • Reg CA offers a Startup Exemption of up to $5 million over four years, and Fundraising Tiers of up to $20 million (Tier 1) and $75 million (Tier 2) over 12 months.
- • The conditional investment contract safe harbor (Rule 400) would let issuers file Form TR to deem a covered investment contract terminated, and it is non-exclusive, potentially reaching tokens already circulating.
- • The proposal does not address secondary market trading or intermediaries, leaving exchanges, brokers, and dealers facing unresolved registration uncertainty tied to the conflicting Ripple and Coinbase district court rulings.
- • Form TR relies on issuer self-certification that the SEC may challenge at any time, and the proposal gives no express reliance protection to third parties such as exchanges, brokers, and asset managers.
Summary
On August 18, 2026, the Securities and Exchange Commission proposed Regulation Crypto Assets ("Reg CA"), the agency's first standalone offering framework for crypto assets. Chairman Paul Atkins described the rule as part of a broader effort to "onshore innovation in crypto asset markets for generations to come." The proposal follows the Commission's March 17, 2026 interpretive release, which classified crypto assets into five functional categories: digital commodities, digital collectibles, digital tools, stablecoins, and digital securities. Mintz notes that Congress has not yet advanced the CLARITY Act to the Senate floor, leaving the industry without statutory clarity.
Reg CA applies to "covered investment contracts" involving only a non-security crypto asset. It establishes three pathways. The Startup Exemption (Rule 200) permits offerings of up to $5 million over four years, allows general solicitation, imposes no accredited investor requirement, and requires a notice filed on new Form NOR along with public narrative disclosures. The Fundraising Exemption (Rules 300-307) provides Tier 1 offerings of up to $20 million over 12 months, with no more than $6 million from affiliated selling securityholders, and Tier 2 offerings of up to $75 million over 12 months, with no more than $22.5 million from affiliates. These tiers involve SEC staff review, an offering statement on Form 1-CRYPTO, and ongoing reporting, and Tier 2 financials must be audited. Issuers must be U.S.-organized and meet domestic-presence criteria.
The Investment Contract Safe Harbor (Rule 400) is the proposal's most consequential provision. An issuer that has completed or permanently ceased its promised essential managerial efforts may file Form TR, upon which the SEC would deem the covered investment contract terminated. The safe harbor is non-exclusive, so tokens already in circulation could potentially qualify. Proposed Rule 500 would preempt state registration requirements for Reg CA offerings and certain secondary transactions, while states retain anti-fraud and notice-filing authority.
Mintz characterizes the proposal as substantive but limited. Its principal gap is the absence of relief for secondary market participants: exchanges, brokers, and dealers may still face registration requirements for tokens that have not obtained Form TR certification. This remains unresolved given the conflicting district court analyses in SEC v. Ripple Labs (Judge Torres) and SEC v. Coinbase (Judge Failla), the latter dismissed by the SEC in February 2025 without appellate ruling. Mintz also flags the $75 million ceiling as potentially insufficient for large projects, noting that exceeding it would push issuers toward Regulation D and accredited-investor restrictions. Finally, the reliance on issuer self-certification, which the Commission may challenge at any time, offers no express reliance protection to third parties who transact based on a Form TR filing.
Reg CA applies to "covered investment contracts" involving only a non-security crypto asset. It establishes three pathways. The Startup Exemption (Rule 200) permits offerings of up to $5 million over four years, allows general solicitation, imposes no accredited investor requirement, and requires a notice filed on new Form NOR along with public narrative disclosures. The Fundraising Exemption (Rules 300-307) provides Tier 1 offerings of up to $20 million over 12 months, with no more than $6 million from affiliated selling securityholders, and Tier 2 offerings of up to $75 million over 12 months, with no more than $22.5 million from affiliates. These tiers involve SEC staff review, an offering statement on Form 1-CRYPTO, and ongoing reporting, and Tier 2 financials must be audited. Issuers must be U.S.-organized and meet domestic-presence criteria.
The Investment Contract Safe Harbor (Rule 400) is the proposal's most consequential provision. An issuer that has completed or permanently ceased its promised essential managerial efforts may file Form TR, upon which the SEC would deem the covered investment contract terminated. The safe harbor is non-exclusive, so tokens already in circulation could potentially qualify. Proposed Rule 500 would preempt state registration requirements for Reg CA offerings and certain secondary transactions, while states retain anti-fraud and notice-filing authority.
Mintz characterizes the proposal as substantive but limited. Its principal gap is the absence of relief for secondary market participants: exchanges, brokers, and dealers may still face registration requirements for tokens that have not obtained Form TR certification. This remains unresolved given the conflicting district court analyses in SEC v. Ripple Labs (Judge Torres) and SEC v. Coinbase (Judge Failla), the latter dismissed by the SEC in February 2025 without appellate ruling. Mintz also flags the $75 million ceiling as potentially insufficient for large projects, noting that exceeding it would push issuers toward Regulation D and accredited-investor restrictions. Finally, the reliance on issuer self-certification, which the Commission may challenge at any time, offers no express reliance protection to third parties who transact based on a Form TR filing.
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